McColl’s Retail Group is insisting its full service with PayPoint will be available soon, after the payment service provider suspended bill payment services in the majority of its stores.
PayPoint said it had taken the steps “to ensure the continuity of its services for its clients and customers”. The move follows press reports last weekend that suggested McColl’s was in a race against time to secure further investment in order to save the business from administration.
On Monday, McColl’s issued a response to the coverage, confirming it remained in discussions with its lending banks with the aim of reaching a longer-term agreement in relation to the balance of its c£170m debt facility. The statement added that it had “received the necessary agreement to roll forward its financial covenant test periodically, and continues to receive credit support from its key commercial partner, Morrisons, to enable these discussions”. It also “continues to believe that a financing solution will be found that involves its existing partners and stakeholders”, it said.
PayPoint’s move emerged today as it issued a statement to independent retailers to expect increased trading due to the suspension of its services in McColl’s stores.
The warning, seen by The Grocer, reads: “As of this morning, the majority of PayPoint’s services are now unavailable in McColl’s stores in your area. We wanted to make you aware of this as you may experience an increase in customers visiting your store.”
A PayPoint spokesman said: “Further to McColl’s Retail Group’s statement on 28 February, PayPoint has implemented measures to ensure the continuity of its services for its clients and customers. After discussions with the McColl’s leadership team, PayPoint can confirm it has suspended bill payment services in the majority of McColl’s sites until further notice.
“All other essential cash out and parcel services remain unaffected. PayPoint is focused on providing vital services at the heart of communities across the UK and customers will still be able to access its full range of services, including bill payments, pre-payment transactions and parcel delivery, at over 27,000 locations, a network larger than all banks, supermarkets and Post Offices put together. Customers can visit paypoint.com to find their nearest store.”
He added: “We continue to monitor the situation closely and will provide an update in due course, where appropriate.”
However, McColl’s appeared to play down the situation. “We are grateful for the ongoing support of all of our suppliers,” said a spokesman. “Specific PayPoint services were temporarily suspended in a number of our stores, but full service is expected to resume shortly across our entire estate.”
The weekend press reports also indicated that McColl’s had received a bid for the business that had since been revoked from Asda owners the Issa brothers and TDR Capital.
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